It’s been said that W. Edwards Deming, despite his revelations about the destructive nature of the prevailing style of management, was an optimist. We need optimism! America today is a deeply divided country in which the majority of workers are disengaged and dispirited in their jobs and live in an economy that by many measures is failing them. Deming’s warnings of the consequences of clinging to outdated business practices have sadly come to pass.

Deming’s work, nonetheless, provides a beacon of hope. This message was flawlessly delivered on October 16 and 17 at the 2024 Deming Leadership Seminar in Columbus, Ohio, sponsored by The W. Edwards Deming Institute and led by a team of veteran Deming practitioners.

What’s encouraging is that while anxiety and interpersonal stress are widespread in most workplaces, it doesn’t have to be that way. Throughout the two-day event, there was an upbeat mood as the presenters led an interactive exploration of what’s possible with the philosophy and tools that Deming provided.

Most people grasp intuitively what needs to be improved. Even those who love their work are stymied by all the “other stuff,” to put it politely, that they have to deal with. This “other stuff” isn’t just necessary drudgery like filling out expense reports. It’s also the adversarial relationships, fear of speaking out, poor coordination, lack of support, and having to do things just to please the boss.

Deming pointed out that management has the power and the responsibility to address this “other stuff.” Ninety-four percent of problems workers confront, he stated in his posthumously published book “The New Economics,” are caused by the system, not the workers. And the design of the system is management’s responsibility.

The event is a modern version of the famous four-day seminars that Deming conducted during the 1980s and early 1990s, which served as the starting point for some of the most celebrated continuous improvement journeys. Two factors made it possible to cover the material in two days.

First, the organizers applied a blended learning approach to make the best use of the available time. Excellent pre-study materials, provided on the DemingNEXT^â learning program (available at www.Deming.org) allowed presenters to get to into heart of the course without spending time on definitions and basic concepts. Post-study materials and ongoing online conversations accomplish the role of recapping and reinforcing the material and provide guidance and a supportive community to help leaders move forward.

Most important, however, was the content itself. Dr. Deming had worked on improving his seminar materials right up to the end of his long and productive life. The crowning achievement of that was The Deming System of Profound Knowledge (SoPK)^â, which was first introduced in “The New Economics.” As intended, this enables a more concise presentation of the essential elements of Deming’s revolutionary approach.

SoPK serves as a guiding framework for organizational leadership, and for applying PDSA, control charts, and other familiar tools. As seminar leader Kelly Allan explains, learning the tools is only 20% of the task for leaders – the remaining 80% is about learning and applying SoPK.

SoPK provides the theoretical basis for how organizations behave. Deming, who earned his PhD in mathematical physics at a time when discoveries in quantum physics were upending our view of the physical world, saw the need to apply new theories to explain the world as we know it. Consequently, SoPK reflects the latest discoveries and observations in statistics, systems theory, and human motivation and behavior.

Many of Deming’s observations have become mainstream thanks to popular books on these subjects, such as Daniel Kahneman’s 2011 bestseller “Thinking Fast and Slow.” What Deming called the “Deadly Disease” of managing by visible numbers alone, for example, can be explained by a concept Kahneman called WYSIATI (What You See Is All There Is), by which humans jump to conclusions based on available information and assume there’s nothing more to consider.

But the most important breakthrough is the adoption of complex adaptive systems (CAS) theory, which emphasizes the role of interdependence in the behavior of complex systems such as weather and climate patterns, biological organisms and ecosystems, and human constructs such as the economy and organizations. Deming’s application of CAS to organizational behavior represents a radical departure from the reductionist view, based on 17^th century science, which holds that component subsystems of an organization can be effectively managed as if they were independent.

In most organizations, finance systems, departmental divisions, annual performance appraisals, and incentive-based targets all reflect this archaic reductionist paradigm, creating huge inertia, and making the path to transformation a formidable one.

This was evident in a case study exercise in which groups of participants were assigned to represent departments in an unnamed company based on a real-life scenario. Each was given a target.

• Credit Approval: Reduce Losses by 10%
• Sales: Increase Sales by 10%
• Procurement: Reduce Supply and Supplier Costs by 10%
• Operations: Reduce Costs by 10% and Ship 10% Faster

Participants were given five minutes to name measures they would take to meet their target using the prevailing style of how organizations operate. Participants quickly filled their flipcharts with interventions that are all too familiar. Sales offered special concessions and discounts to boost their numbers. Credit Approval introduced penalties and “fired” the customers that were slow payers. Procurement squeezed suppliers and accepted contracts based solely on low bid. Operations cut back on quality in order to ship faster and reduce costs.

The participants then forecast how the departments would perform given the changes made by all the departments, and that was compared what had happened in real life. Results seemed to be okay for the first quarter. In the second quarter, sales start to fall, and by the third quarter, it was clear that customers were defecting in droves due to quality, surly service, and failure to deliver on promises. The company was on the road to destroy itself, all from actions that participants had chosen based on their experience with “business as usual.” A powerful lesson!

The seminar also revealed the emotional impact of the prevailing style of management. For example, in Deming’s famous Red Bead Experiment, participants playing the role of “willing workers” are instructed by a “foreman” to engage in a process in which they are set up to fail. They have no control over the results (“defective” red beads occur randomly) yet are constantly chided to improve their performance. While the irony was obvious, “willing workers” still felt a bit anxious (I should know – I was the worst performer!) and others expressed sympathy for us “poor performers.” A powerful lesson from a scenario that sadly occurs too often in real life.

The seminar concluded, appropriately, with an exercise where participants, using SoPK as their compass and guide, applied the tools presented – PDSA, control charts, alignment with the aim of the organization, to design improvements in their own companies. It was clear to all that this was not the end of the learning process, but the beginning.

The good news is that while the barriers to change are significant, this is not rocket science. The methods are eminently learnable because they fit the world that we see every day. Many familiar business practices, on the other hand, are complicated and time-consuming because they are inherently unnatural. Are your managers tying up their time doing performance reviews and dealing with complaints about ratings? Simply stop doing it and replace the process with an honest dialogue about the work, how things are going, and how they could be better. Are your departments fighting each other over the fairness of their KPIs? Stop doing it and get everybody working towards the common aim of the whole company.

As Kelly Allan writes in his added chapter to the third edition of “The New Economics,” change begins with a personal journey. “Start by learning so you can change yourself, then change your organization, change your community….change the world.”

And as Dr. Deming, not one to waste words, wrote, “Transformation is required.”